Sri Lanka’s tea prices hit record in August
ECONOMYNEXT – Sri Lanka’s low-grown Ceylon teas hit a new record of 1,161.24 rupees a kilogram in August 2022, up from 619 rupees a year earlier industry data showed, as the currency collapsed steeply following mistargeted interest rates and a botched float with a surrender requirement.
In the last week of August low growns averaged 4.39 dollars a kilogram up from 2.95 a year earlier. Global commodity prices have moved up due to US money printing, which tends to weaken the dollar.
In Sri Lanka Mercantilists and soft-peggers usually claim that inflation comes from imported prices. However, prices of all traded goods, whether imported or exported go up when the central bank prints money to depreciate the currency.
Global prices also go up in dollar terms (commodity booms) when the US Federal Reserve prints money. At the moment commodity prices are booming due to the so-called ‘Powell Bubble’ the worst since the Greenspan-Bernanke bubble which broke in 2008/2009.
At the August 30 sale auction, Low Grown leafy/Tippy variety had seen an increased demand selling 1.7 million kilograms with strong demand.
Low Grown attract the highest prices for Ceylon Tea.
In the August 4th week auction, the Low Grown Tea sale average was 1,727.39 rupees, up from 1,654.03 rupees in the previous week.
In dollar terms, it had shot up to 4.78 dollars per kilogram, up from 4.58 dollars in the previous week.
BOPF’s Select best were lower whilst all others were firm.
OP’s Well-made varieties together with cleaner below best maintained. Bottom and others too followed a similar trend.
OPA’s well-made sorts together with cleaner below best followed a similar trend to their OP counterparts. Poorer types gained.
BOP1’s few Select best gained whilst others and below best were irregular. Teas at the lower end maintained.
FBOPF/FBOPF1’s Select best with best were dearer to last whilst others held firm. All tippy invoices were easier.
High Grown
The High Grown auction average was 1,422.56, down from 1,436.31 rupees.
In BOP, Best Westerns were firm. Below best and plainer teas were firm to Rs.50/- per kg dearer.
Nuwara Eliya’s were up by Rs.100/- per kg. Uda Pussellawa’s moved up by Rs.50/- per kg. Uva’s gained by Rs.100/- per kg and at times more.
In BOPF, Best Western’s were mostly firm. Below best and plainer types appreciated by Rs.50/- per kg.
Nuwara Eliya’s were barely steady. Uda Pussellawa’s Rs.50- per kg dearer. Uva’s gained by a similar margin.
Medium Grown
The Medium Grown auction average for the week was 1,234.18 rupees down from 1,135.53 rupees a week before.
This week, BOPF’s Select best and best were dearer by 50 rupees per kilogram whilst the all others were firm.
In BOP1, Select best were firm whilst all others dearer by Rs. 50/- per kg.
While OP1’s Select best, best and the below best declined by Rs.100/- per kg. Poorer sorts eased by Rs.50/- per kg.
In the PEKOE/PEKOE1 PEK category in general, appreciated by Rs. 50/- per kg while PEK1’s Select best and best increased by Rs. 100/- per kg whilst all others gained by Rs. 50/-
per kg.
In the FBOP category, Select best and best declined by Rs. 50/- per kg whilst all others were firm.
FBOPF1’s Select best, best and the below best dearer by Rs.100/- per kg. Poorer sorts eased by Rs.50/- per kg.
CTC
High-grown BP1s has had hardly any offerings while PF1’s firm to marginally dearer.
Mid grown BP1s were irregular.
Low-grown BPIs lower 50 rupees a kilogram, while better PF1 teas declined by 200 rupees per kilogram.
(Colombo/Sept11/2022)
